Apple Raycer takeover ‘all but done’

Analysis Apple has bought high-end 3D accelerator chip developer Raycer Graphics for around $15 million, according to the Wall Street Journal. News of the two companies' negotiations emerged earlier this week. Since then, MacWeek.com sources confirmed that the deal is "all but done", and it now looks like Raycer's staff will become Apple employees on Monday. So far, neither company has officially commented on the acquisition -- presumably that will happen on Monday, too -- so Apple's motives remain unclear. Improving the Mac's ability to process 3D information is the broad reason for the deal, but this method seems an unusual way of doing so in light not only of Apple's close relationship with the market-leading 3D chip company, ATI, but the trouble the Mac maker is having gaining support from the wider 3D hardware industry. Having an exclusive deal with ATI is bad enough, here -- having your own in-house 3D team could easily kill off ATI's support and the burgeoning friendship with 3dfx. Apple could argue that it wants to be free from reliance on third parties for such a key technology, but that's just going back to the 'not invented here' philosophy the company claims to have long since abandoned. However, a new take on the deal is emerging: Raycer's little-known interest in system-on-a-chip development. Apple's drive to bring down costs led to the development of its Unified Motherboard Architecture (UMA) strategy whereby all Macs are based around a single, core system. Having done that, the next stage is clearly to bring the cost of the UMA down, and the integration of the board's numerous chips is a clear way forward here. Hints that Apple was planning such a move emerged earlier this year when it was suggested that the company was talking to chip vendors about how to create an iMac-on-a-chip part which would combine the chip's networking, peripherals, memory, bus and video chipsets onto a single slice of silicon. For your instant iMac, just add PowerPC... Importantly, for Apple, this would allow it to get the price of both iMac and iBook right down, possibly under $700, and allow it to compete with the full range of consumer-oriented Wintel machines and heighten the iMac's desirability in an increasingly price-sensitive market. That could well be the motivation behind the Raycer acquisition. If Apple focuses the technology on its consumer lines, that would leave space at the high-end, where possible performance losses from such integration are more of an issue (the 'jack of all trades, master of none' vs dedicated products argument), for a continued relationship with ATI. Indeed, since ATI is itself interested in system-on-a-chip development -- last year it bought media processor developer Chromatic Research to kick-start its SoC design work -- Apple's acquisition may very well lead to a closer partnership between the two vendors. ®